As Obama's "recovery" rolls along, the Wall Street Journal points out that the delinquency rates of subprime credit cards has surged to the highest levels recorded since 2012. Moreover, per TransUnion data, delinquency rates on cards issued in 2015 are close to 3%, or roughly double the overall rate, indicating that consumers have grown increasingly dependent on credit cards over the past couple of years to fund daily expenses. Credit-card lending to subprime borrowers is starting to backfire. Missed payments on credit cards that lenders issued recently are higher than on older cards, according to new data from credit bureau TransUnion. Nearly 3% of outstanding balances on credit cards issued in 2015 were at least 90 days behind on payments six months after they were originated. That compares with 2.2% for cards that were given out in 2014 and 1.5% for cards in 2013. The poorer performance on newer cards pushed up the 90-day or more delinquency rate for all credit cards to 1.53% on average nationwide in the third quarter. That’s the highest level since 2012. Meanwhile, FRED data reveals that while overall credit card delinquency rates remain at 10-year lows, the trends has been higher over the past several quarters. Of course, as we've noted before, part of the problem is that credit card companies have been forced to compete with the "peer-to-peer" loan providers whose volume has grown exponentially since tapping into the Wall Street securitization machine in 2015. Unfortunately, this latest wall street ponzi scheme only serves to ruin the long-term credit quality of borrowers as most people use proceeds to repay credit cards then simply max them out all over again. We first noted Wall Street's misguided plan to feed its securitization machine with peer-to-peer (P2P) loans back in May 2015 (see "What Bubble? Wall Street To Turn P2P Loans Into CDOs"). Obviously we warned then that the voracious demand for P2P loans was a direct product of central bank policies that had sent investors searching far and wide for yield leaving them so desperate they were willing to gamble on the payment streams generated by loans made on peer-to-peer platforms. In addition to the pure lunacy of using unsecured, low/no-doc, micro-loans as collateral for a CDO, we pointed out that the very nature of P2P loans meant that borrower creditworthiness likely deteriorated as soon as loans were issued. The credit deterioration stemmed from the fact that many borrowers were simply using P2P loan proceeds to repay higher-interest credit card debt. That said, after paying off that credit card, many people simply proceeded to max it out again leaving them with twice the original amount of debt. And, sure enough, it only took about a year before the first signs started to emerge that the P2P lending bubble was bursting. The first such sign came in May 2016 when Lending Club's stock collapsed 25% in a single day after reporting that their write-off rates were trending at 7%-8% or roughly double the forecasted rate (we wrote about it here "P2P Bubble Bursts? LendingClub Stock Plummets 25% After CEO Resigns On Internal Loan Review"). As the WSJ points out, the credit quality of borrowers has declined materially over the past couple of years. In fact, the volume of subprime card issuance was up 20% year-over-year in 2015 and 56% compared to 2013. Meanwhile, declining household income related to the oil bust has also led to higher delinquencies. The recent increase in subprime lending is one of the big contributors. Lenders ramped up subprime card lending in 2014 and have been doling out more of these cards recently. They issued just over 20 million credit cards to subprime borrowers in 2015, up some 20% from 2014 and up 56% from 2013, according to Equifax. Separately, missed payments in states with large oil or energy sectors continue to worsen. The share of card balances that were at least 90 days past due increased 12% in Oklahoma, 10% in Texas and 20% in Wyoming in the third quarter from a year prior, according to TransUnion. The Wall Street Journal reported in April that rising unemployment in the energy sector was pushing up delinquencies on credit cards and auto loans, raising the risk of new losses for banks. Why do we suddenly have a sinking suspicion that victims of "predatory credit card lending practices" will be the next bailout target of democrats after taxpayers are forced to pick up the tab for outstanding student loan debts?
Scott B. MacDonald Economics, Middle East Investors’ search for yield outweighs risk—at least for now. October’s $17.5 billion sovereign bond deal launched by the Kingdom of Saudi Arabia was an emerging-markets record, eclipsing Argentina’s $16.5 billion deal earlier this year. According to the Financial Times, demand for the Saudi deal was well in excess of its size, reaching $67 billion. The size and success of the Saudi deal reflects the increasingly risky nature of global securities markets and has significant geopolitical implications. International financial markets are dominated by the search for yield. A number of factors are at play: a growing number of people in the West and Japan are trying to retire and tap retirement and pension plans, wages in many advanced economies have stagnated for an extended period, and near-zero or negative-interest-rate policies by major central banks have increasingly penalized savers, pension funds and insurance companies. In the latter case, highly accommodative monetary policy has taken away the option of would-be retirees to generate interest-rate income, which is making many work longer and contributes to social angst, giving impetus to populist political parties and leaders in Europe and the United States. To find yield, investors are being forced to assume greater risk, a situation that benefits sovereign issuers such as Saudi Arabia. The plunge in oil prices since 2014 has hurt the Middle Eastern country in terms of larger fiscal deficits (over 10 percent of GDP last year), lower export revenues and painful cuts in public expenditures. Yet the kingdom remains solidly investment-grade, continues to have a comparative advantage in pumping cheap oil and has enjoyed a relative degree of political stability. Moreover, a young, well-educated group of royals is implementing long-needed structural reforms to diversify the economy. The new bond issue will add to the country’s rising debt (up from $38 billion in December 2015 to $73 billion in August 2016), but will replenish foreign-exchange reserves and be used to help reforms. Read full article
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Like what you read below? Sign up for HUFFPOST HILL and get a cheeky dose of political news every evening! Trump rudely dismissed an adult-film star’s allegations against him, meaning his campaign has unfolded more or less as we all expected ― short of the appearance t-shirt cannons and someone playing a guitar that spews fire from its neck. Washington power players are having lawyers run opposition research on them, because having your name crop up in Wikileaks is so yesterday. And a group of Republicans are threatening to sue TV stations for airing ads that link them to Donald Trump, because threatening to sue over media coverage you don’t like is the best way to avoid comparisons to Donald Trump. This is HUFFPOST HILL for Monday, October 24th, 2016: TRUMP SUPER PAC CAUGHT FUNNELING FOREIGN DONATIONS - Telegraph: “Donald Trump’s presidential campaign is facing a fundraising scandal after a Telegraph investigation exposed how key supporters were prepared to accept illicit donations from foreign backers. Senior figures involved with the Great America PAC, one of the leading ‘independent’ groups organising television advertisements and grassroots support for the Republican nominee, sought to channel $2 million from a Chinese donor into the campaign to elect the billionaire despite laws prohibiting donations from foreigners. In return, undercover reporters purporting to represent the fictitious donor were assured that he would obtain ‘influence’ if Mr. Trump made it to the White House.” [Telegraph] TRUMP IMAGINES BEAUTIFUL UTOPIA WHERE ALL OUR TOYS ARE MADE OF LEAD - And airbags are just whoopie cushions that shoot confetti. Dave Jamieson: “It can be notoriously difficult to pin down Donald Trump on the finer points of policy. But on Monday morning, the Republican presidential nominee put forth a surprisingly specific proposal: He is going to cut ‘70 to 80 percent’ of federal regulations if he wins the White House. Trump, lagging badly in the polls, made his anti-regulatory vow while speaking at a farmers’ roundtable in Boynton Beach, a town in the must-win state of Florida. The real estate mogul did not explain how his administration would determine which rules to axe, or how they would go about accomplishing such an unprecedented rollback through executive fiat. ‘We want clean air, we want clean water,’ Trump said. ‘But we have and you have situations and regulations, which we’re gonna cut ― we will probably cut 70 to 80 percent of the regulations, OK?’” [HuffPost] tfw your very existence is construed as an insult: “[Some] Republicans are threatening to sue TV stations for running ads that link them to the GOP presidential nominee. Five candidates ― Reps. Bob Dold (R-Ill.), Mike Coffman (R-Colo.), David Jolly (R-Fla.), John Katko (R-N.Y.) and Brian Fitzpatrick, a Pennsylvania Republican running for an open seat that’s currently occupied by his brother ― contend that certain commercials paid for by the Democratic Congressional Campaign Committee provide false or misleading information by linking them to Trump.” [HuffPost’s Matt Fuller] TRUMP MAKES INSURANCE FRAUD GREAT AGAIN - What’s the over/under on the White House burning down and President Trump blaming it on a stray gas leak? Jeff Horowitz and Terry Spencer: “Donald Trump said he received a $17 million insurance payment in 2005 for hurricane damage to Mar-a-Lago, his private club in Palm Beach, but The Associated Press found little evidence of such large-scale damage. Two years after a series of storms, the real estate tycoon said he didn’t know how much had been spent on repairs but acknowledged he pocketed some of the money. Trump transferred funds into his personal accounts, saying that under the terms of his policy, ‘you didn’t have to reinvest it.’ In a deposition in an unrelated civil lawsuit, Trump said he got the cash from a ‘very good insurance policy’ and cited ongoing work to the historic home.... Trump’s description of extensive damage does not match those of Mar-a-Lago members and even Trump loyalists. In an interview about the estate’s history, Trump’s longtime former butler, Anthony Senecal, recalled no catastrophic damage.” [AP] Like HuffPost Hill? Then order Eliot’s new book, The Beltway Bible: A Totally Serious A-Z Guide To Our No-Good, Corrupt, Incompetent, Terrible, Depressing, and Sometimes Hilarious Government Does somebody keep forwarding you this newsletter? Get your own copy. It’s free! Sign up here. Send tips/stories/photos/events/fundraisers/job movement/juicy miscellanea to [email protected] Follow us on Twitter - @HuffPostHill TRUMP DISMISSES NEW SEXUAL ASSAULT CLAIMS IN TRUMP-IEST WAY POSSIBLE - Donald Trump, the “sup,babe?” candidate. Igor Bobic: “Donald Trump dismissed an adult film star who came forward over the weekend and alleged the GOP nominee had sexually mistreated her in 2006, stating in an interview, ‘Oh, I’m sure she’s never been grabbed before.’ Speaking at a Saturday press conference in Los Angeles alongside her attorney, women’s rights activist Gloria Allred, Jessica Drake became the 12th woman to come forward with allegations of sexual misconduct against the New York real estate mogul. She accused Trump of kissing her and her friends without permission and offering her money to spend the night with him…. ‘These are stories that are made up, these are total fiction,’ Trump said during an interview on WGIR radio, according to CNN.” [HuffPost] NO, TRUMP DID *NOT* RECEIVE A NAACP AWARD - Perhaps from the National Association For Awesomely Classy People, but not the NAACP you know. Christina Wilkie: “A photograph of Donald Trump, Muhammad Ali and Rosa Parks that the founder of Trump’s ‘diversity coalition’ hailed as evidence the Republican nominee won an ‘NAACP medal’ for ‘helping America’s inner cities’ was actually taken at an awards ceremony organized by a business associate with an ethnic grievance. William Fugazy, a politically well-connected businessman who later pleaded guilty to perjury, gave the awards to Trump and 79 other people, most of them white, to protest the awarding of ‘medals of liberty’ to a group of 12 recent immigrants that included a Chinese-born architect, a Costa Rica-born astronaut, a leading expert on the psychology of race, and former Secretary of State Henry Kissinger, but no ‘Irish, Italian, or Polish’ people.... The NAACP has not awarded any medals to Trump for ‘helping America’s inner cities,’ the group told HuffPost. Nor have any other civil rights groups, according to Trump’s biographers.” [HuffPost] GRASSLEY: GARLAND HEARINGS TOO EXPENSIVE - We’re guessing his staff isn’t going to tell the senior senator from Iowa about the costs of the Dirksen cafeteria’s sushi bar. Cristian Farias: “Speaking last week to the editorial board of the Des Moines Register, a leading newspaper in his home state, the senator suggested that holding a confirmation hearing for Garland would not be the fiscally conservative thing to do. ‘My staff tells me that’s about a half a million to $750,000 to hire people to maybe work for three or four months to do it,’ Grassley told the editorial board, which wrote in May that history won’t remember the senator kindly for blockading Obama’s nominee. In the hourlong sit-down with the paper, Grassley said that not holding a hearing due to its potential cost was simply ‘a tradition’ he might follow because of ‘how deep you have to go in to go through a person’s record in order to hold a hearing that’s worthwhile.’” [HuffPost] RECALLING TRUMP’S SECOND MARRIAGE - Jennifer Bendery: “Trump, who was 45 at the time, was with Maples at a Miss America Pageant in Atlantic City, New Jersey, when he walked into a dining room where contestants were eating pizza and demanded, ‘I want to see the bodies that won the swimsuit contest,’ People reported at the time. One of them, 24-year-old Carolyn Sapp of Hawaii, stood up, embarrassed. Trump looked her over for a moment before he and Maples walked out. Apparently that didn’t rattle Maples as much as it did when the pageant was over, when Trump and some of his friends made rude comments about Sapp, who went on to become Miss America, as Maples sat there with them. ‘They were sitting around saying, ‘She’s got a great body!’ and ‘It’s about time they got a good-looking one,’’ Maples told People. ‘He still thinks it’s cool to act like a ladies’ man. But I don’t think it’s very respectful. I deserve better than that.’ She called off their marriage soon after that. They eventually did tie the knot in 1993, though, for six years.” [HuffPost] AYOTTE DUMPS TRUMP - Eric Bradner: “New Hampshire Sen. Kelly Ayotte has dropped Donald Trump ― and now, facing a tough re-election challenge, she is making the case that she’d be a check on Hillary Clinton in Washington. Ayotte, the first-term Republican who’s trailing Democratic challenger Maggie Hassan in the polls, all but admitted that Clinton is poised to win the White House on Monday. ‘There’s so much at stake in this presidential election: the Supreme Court, our national security, so many issues that matter to people of this state,’ Ayotte told CNN’s Manu Raju in an interview. ‘And Gov. Hassan is going to essentially follow Hillary Clinton’s lead on all of them, where I’m going to stand up to her when she’s not taking us in the right direction,’ Ayotte said.” [CNN] WHAT A LOAD OF CRAPO - Expect other super-smart Crapo wordplay in this space. Only the best for you, dear readers. Arthur Delaney: “When it became clear that Donald Trump would be the Republican Party’s nominee for president earlier this year, Sen. Mike Crapo (R-Idaho) endorsed him. When a video surfaced a few weeks ago of Trump boasting of sexually assaulting women, Crapo withdrew his endorsement and said Trump should withdraw his candidacy. But the Idaho Republican later said he hadn’t decided whether he’d vote for Trump. On Friday, Crapo came clean: He will vote for Trump after all. ‘The choice we still have today and the choice we will have is between Donald Trump and Hillary Clinton,’ Crapo told an Idaho radio station. ‘In that context, I have to tell you, though I thought and felt we needed a different choice, that’s not what we’re going to get, and we cannot elect Hillary Clinton for many reasons.’ On Monday, to make sure people noticed the re-endorsement, Crapo’s campaign pushed out the Idaho State Journal’s Friday story.” [HuffPost] @anamariecox: Listening to Rush Limbaugh rn telling his audience they should not reject polling. Admits he was wrong to question polls in 2012. NEITHER CAMPAIGN AGREEING TO PROTECTIVE POOL REPORTS - But how will the globalist conspiracy spread its internal messages? Michael Calderone: “Neither campaign has yet agreed to a protective pool to track the president-elect’s movements, a departure from recent election cycles. ‘It is not normal and it is unacceptable,’ Jeff Mason, a Reuters correspondent and president of the White House Correspondents’ Association, told The Huffington Post. The White House Correspondents’ Association oversees the rotating group of reporters who travel everywhere with the president and file dispatches to the larger press corps on what he’s doing, whom he’s meeting with and when he returns home. This arrangement, known as a protective pool, is considered necessary to ensure journalists are present in the event of any newsworthy comment or moment, including a threat on the president’s life. Both the Clinton and Trump campaigns have traveling press pools, but neither is fully protective.” [HuffPost] HAVE YOU OPPO’D YOURSELF? Forget Googling yourself. Real power players get the citizenship status of their eldest child’s nanny from the 1990s checked out. Sarah Wheaton, Nancy Cook and Andrew Restuccia: “More than a dozen people who expect — or simply hope — to be tapped by Hillary Clinton or Donald Trump have already reached out to top D.C. lawyers for help in sifting through their finances and business dealings in anticipation of being nominated to a top post in the next administration, POLITICO has learned. ‘More and more, people who are effective nominees are coming to see the wisdom of retaining people to help them,’ said one D.C. lawyer. ‘I talk to a lot of people who are interested in serving, and I tell them all they should get private counsel.’ This need for private professional help — before an election is even over and the confirmation process has begun — has spawned a small yet influential cottage industry within big D.C. law firms of professional vetters, who can charge anywhere from hundreds of dollars to as much as $1,000 per hour to sort through a potential nominee’s convoluted finances, tax returns or even old arrest records.” [Politico] Echochamber update: “Hyperpartisan political Facebook pages and websites are consistently feeding their millions of followers false or misleading information, according to an analysis by BuzzFeed News. The review of more than 1,000 posts from six large hyperpartisan Facebook pages selected from the right and from the left also found that the least accurate pages generated some of the highest numbers of shares, reactions, and comments on Facebook — far more than the three large mainstream political news pages analyzed for comparison.” [BuzzFeed] BECAUSE YOU’VE READ THIS FAR - Here’s a dog trying to eat the rain. THIEL LOSING BUSINESS OVER TRUMP SUPPORT - And here we thought Silicon Valley might be upset with his rape apologism. Whatever! Lizette Chapman: “Arlan Hamilton, managing partner at Backstage Capital, said she rejected a potential investor because the person refused to disavow and sever ties with Thiel, a co-founder of PayPal and Palantir Technologies Inc. She declined to name the investor, saying the person offered to put $500,000 in her Los Angeles-based technology seed fund. While the amount is tiny by industry standards, it is significant to Hamilton’s year-old seed fund, which has about $5 million in commitments, according to a report by Inc. The stymied deal reflects the growing divisiveness in the run up to the U.S. presidential election, which is spilling into everyday business. Hamilton took to Twitter to air her political protest.” [Bloomberg] COMFORT FOOD - Today is the 70th anniversary of the first photo of Earth from space. - The world’s most delightful mountain. - Baking bread with a volcano. TWITTERAMA @OKnox: “My GOD!” he exclaimed. “Rearrange ‘nasty women’ and you get ‘amnesty now!’” @elisefoley: I sense a tweetstorm coming. My knee is acting up. @aedwardslevy: “So, that’s nine votes for pasta, five for pizza, and two for eggpl-” “THIS ELECTION IS RIGATONIED” Got something to add? Send tips/quotes/stories/photos/events/fundraisers/job movement/juicy miscellanea to Eliot Nelson ([email protected]) or Arthur Delaney ([email protected]). -- This feed and its contents are the property of The Huffington Post, and use is subject to our terms. It may be used for personal consumption, but may not be distributed on a website.
Do stock markets today resemble the lead-up to Black Monday? The answer is no - for a variety of reasons.
The Massachusetts senator blasted Donald Trump’s “nasty woman” remark at a Clinton rally in New Hampshire.
NEW YORK, Oct 24 (Reuters) - A lawyer for financier Lynn Tilton on Monday blasted U.S. Securities and Exchange Commission charges that she defrauded investors in three debt funds as "ludicrous," as the agency sought to bar her from the financial industry.
Ford Motor Co. (F) is set to release third-quarter 2016 results on Oct 27.
Join Dave Bartosiak at 9:00am Central Time on Tuesday, October 25th, to see his thoughts on Apple Inc. (AAPL) before they report earnings with real-time options insight.
ImmunoGen, Inc. (IMGN) is scheduled to report its results for the three months ended Sep 30, 2016 on Oct 28 before the opening bell.
Economist Tom Lawler sent me the table below of short sales, foreclosures and all cash sales for selected cities in September.On distressed: Total "distressed" share is down year-over-year in most of these markets. Short sales and foreclosures are down in most of these areas.The All Cash Share (last two columns) is mostly declining year-over-year. As investors continue to pull back, the share of all cash buyers continues to decline. Short Sales ShareForeclosure Sales Share Total "Distressed" ShareAll Cash ShareSep-2016Sep-2015Sep-2016Sep-2015Sep-2016Sep-2015Sep-2016Sep-2015Las Vegas4.6%6.8%6.0%7.1%10.6%13.9%26.5%26.8%Reno**3.0%3.0%2.0%3.0%5.0%6.0% Phoenix1.7%2.4%2.0%3.5%3.7%5.9%20.2%23.1%Sacramento1.4%2.9%3.1%4.1%4.5%6.9%16.3%17.6%Minneapolis1.1%1.9%4.3%6.6%5.4%8.5%12.8%12.5%Mid-Atlantic3.1%3.9%8.9%11.1%11.9%14.9%16.5%17.5%Florida SF2.3%3.5%7.8%16.0%10.1%19.4%28.0%34.1%Florida C/TH1.6%2.1%7.0%14.3%8.6%16.4%55.8%59.7%Miami MSA SF3.3%5.1%9.4%18.6%12.7%23.7%28.5%33.2%Miami MSA CTH2.7%2.7%9.5%18.0%12.1%20.7%58.1%63.0%Chicago (city) 12.1%17.5% Spokane 7.8%7.8% Northeast Florida 12.9%23.4% Orlando 31.3%35.5%Toledo 28.0%26.5%Tucson 22.2%25.9%Peoria 20.5%22.3%Georgia*** 20.8%22.3%Omaha 15.5%18.1%Pensacola 29.1%31.4%Rhode Island 11.1%9.0% Richmond VA 8.7%10.5% 18.4%15.2%Memphis 8.8%13.1% Springfield IL** 9.7%10.3%*share of existing home sales, based on property records**Single Family Only***GAMLS
The world's most elite startup investors come in all shapes and sizes. But there's at least one thing they all have in common: they're extremely well-read. The post The Most Prolific Investors in Startups Are Fans of These Books appeared first on Visual Capitalist.
Real estate investors worried about the impact of rising rates will definitely want to listen to this edition of the Dutram Report for insights on the best areas to bet on now.
Potential and actual FDI spillovers in global value chains : the role of foreign investor characteristics, absorptive capacity and transmission channels
Using newly collected survey data on direct supplier-multinational linkages in Chile, Ghana, Kenya, Lesotho, Mozambique, Swaziland, and Vietnam, this paper first evaluates whether foreign investors differ from domestic producers in terms of their potential to generate positive spillovers for local suppliers. It finds that foreign firms outperform domestic producers on several indicators, but have fewer linkages with the local economy and offer less supplier assistance, resulting in offsetting effects on the spillover potential. The paper also studies the relationship between foreign investor characteristics and linkages with the local economy as well as assistance extended to local suppliers. It finds that foreign investor characteristics matter for both. The paper also examines the role of suppliers' absorptive capacities in determining the intensity of their linkages with multinationals. The results indicate that several supplier characteristics matter, but these effects also depend on the length of the supplier relationship. Finally, the paper assesses whether assistance or requirements from a multinational influence spillovers on suppliers. The results confirm the existence of positive effects of assistance (including technical audits, joint product development, and technology licensing) on foreign direct investment spillovers, while the analysis finds no evidence of demand effects.